Bajaj Auto Q2FY25 preview: Revenue may climb upto 25% YoY on strong volumes

Analysts are optimistic about major revenue growth for Bajaj Auto, driven by robust volume increases and effective pricing strategies.

Bajaj Auto Q2FY25 preview: Automobile major Bajaj Auto will announce its September quarter of financial year 2025 (Q2FY25) results on Wednesday, October 16, 2024. 

Analysts are optimistic about major revenue growth, driven by robust volume increases and effective pricing strategies. The street estimates suggest a revenue increase of up to 25 per cent year-over-year, largely fuelled by strong domestic and export sales of two-wheelers.

That apart, the company has seen a major shift towards premium motorcycles, which is expected to enhance average realisations by approximately 7.2 per cent. 

In September 2024, Bajaj Auto reported a 20 per cent jump in vehicle sales, totaling 469,531 units, compared to 392,558 units sold in September 2023.

 

Domestic sales surged 23 per cent to 311,887 units, while exports rose 13 per cent year-over-year to 157,644 units. Two-wheeler sales for the month increased 22 per cent to 400,489 units, up from 327,712 units in the same period last year.

Apart from that, on the bourses, Bajaj Auto shares have surged over 32 per cent this year-to-date (Y-T-D). In comparison, BSE Sensex gained over 12 per cent.
 

Meanwhile, here’s a look at what brokerages expect from Bajaj Auto in Q2FY25:

Nuvama Institutional Equities 

Nuvama Institutional Equities analysts anticipate that revenue growth year-on-year will be driven by volume increases and improved realisations. They expect an expansion in Ebitda margin due to better net pricing. 

Key factors to monitor include the demand outlook in both domestic and international markets, along with initiatives in CNG and e-mobility. The expected revenue is Rs 13,487.8 crore (up 25 per cent Y-o-Y), with an Ebitda of Rs 2,726.9 crore (up 28 per cent Y-o-Y) and an adjusted profit after tax (PAT) of Rs 2,266 crore (up 23 per cent Y-o-Y).

Deven Choksey

Analysts at Deven Choksey project a revenue growth of 21.3 per cent Y-o-Y and 10.2 per cent Q-o-Q for Q2FY25, primarily due to a volume increase of 15.9 per cent Y-o-Y and 10.8 per cent Q-o-Q, alongside higher price realisations. 

The volume growth is attributed to an uptick in domestic and export sales of two-wheelers. They expect an increase of 7.2 per cent Y-o-Y in average realisation, driven by a higher mix of premium motorcycles. 

Additionally, Ebitda margins are anticipated to rise by 145 bps Y-o-Y (+124 bps Q-o-Q), benefiting from operating leverage and favourable commodity trends. 

Thus, net profit is projected to grow by 20.2 per cent Y-o-Y (25.1 per cent Q-o-Q) to Rs 2,428.8 crore. That apart, analysts expect sales of Rs 13,144.6 crore, Ebitda at Rs 2,774.4 crore, and Ebitda margin at 21.1 per cent.

Motilal Oswal

Those at Motilal Oswal said that auto OEMs are projected to deliver about 9 per cent Y-o-Y volume growth in Q2FY25, mainly driven by a robust performance in the 2W segment. 

Additionally, dispatches for two-wheelers are anticipated to have grown about 12 per cent Y-o-Y, with domestic volumes rising about 11 per cent and exports growing 13 per cent annually.

Consequently, analysts at Motilal Oswal project Bajaj Auto to post a revenue of Rs 13,088.6 crore (up 21.4 per cent Y-o-Y), Ebitda at Rs 2,597.1 crore (up 21.8 per cent Y-o-Y), and net profit at Rs 2,156.8 crore (up 17.5 per cent Y-o-Y).
 

InCred Equities

InCred Equities noted that in the September 2024 quarter, the industry’s dispatch volume growth was selective, with two-wheelers leading the way with double-digit Y-o-Y growth. 

They expect single-digit Y-o-Y growth in Ebitda for OEMs, aided by volume growth and declining commodity costs. Among the high achievers in Y-o-Y growth are likely to be Bajaj Auto and TVS Motor Company. 

The expected revenue is Rs 13,097.4 crore, with an Ebitda of Rs 2,660.7 crore and an adjusted PAT of Rs 2,240.6 crore.